Credit Card VC

Quite often, it seems, people violate, or come too close to violating a non-compete clause after they sell a company. Here’s the latest example.

Davis previously sold a recruiting blog to Jobster, and worked with the company for a while. He eventualy left, but apparently had a non-compete in place.

I never really understand why this noncompete stuff ever comes up.

When I sold MyTrafficNews to Traffic.com, I worked hard for them, and enjoyed it. When the contract was over we parted as friends. I gladly signed the non-compete.

Now I’m running another startup, but in a totally different indsutry. As much as I loved the traffic business, I’m very happy to NOT be in it any more.

That’s why I don’t understand when this kind of thing comes up. I would think entrepreneurs, by nature, would want to move on to a different challenge, and apply what they learned in one area to a different industry or niche that needs the same kind of new thinking.

I linked to the story of the guy who stole his own father’s credit cards to start a business, something that violates the nature of Credit Card VC.

There was one bit of the story that bothered me, however, and it was that the story originally broke in the Phoenix New Times, parent company of a newspaper I once toiled at. In the years since I’ve left I’ve seen that the New Times company has gutted investigative reporting in Denver, and all over the country including at the Village Voice in New York City.

So the thing that didn’t quite make sense for me about the story was that the original investigative reporting came from the New Times.

Now, thanks to Mike Arrington, we know the rest of the story. The only way the New Times was able to do an “investigative” story was by pasting together an anonymous email, probably from the credit reporting agencies who might lose business if this company does well.

I’m not saying Maynard is a saint, but if that company takes away a bit of business from the big three credit agencies, I have no beef with that; and Maynard is gone.
My other takeaway? Thanks goodness for the Interweb, and especially guys like Arrington who are willing to pull back the curtain a bit on the way the media works.

I shouldn’t have to say this, but apparently I do.

That guy somehow convinced some reputable VCs to put money into his anti-identity theft venture.

The rub: it turns out that the (accused) slimeball is himself an ID thief, and he did it to his own dad.

Happy Father’s Day!

University Hospital is the last I see in a series of this kind of announcement.

Despite moving to a new facility, the University of Colorado Hospital is expected to layoff up to 70 people by the end of the month due to a budget shortfall.

“Despite”???? How about “Because of”?

We’ve seen this several times in Denver just in the last few months. Certainly newspapers are laying off around the country, but the layoffs at the Denver Post and Rocky Mountain News come just after moving into a shiny new building shown here under construction (in a link that gives a clue about when Google took all those cool new street level pictures) or here for some more recent shots.

And just a few blocks away is the DAM expansion, a dramatic new building that millions of people are not going to. Hence, they had a round of layoffs also.

What does this have to do with your startup? Well, just when you are thinking that it’s time to get a fancy new office, maybe that’s the time to hunker down.

I know I’m linking to Guy twice in a row, but his latest post makes it clear that he fully groks the Credit Card VC ethos:

By the Numbers: How I built a Web 2.0, User-Generated Content, Citizen Journalism, Long-Tail, Social Media Site for $12,107.09

Because of Truemors, I’ve learned a lot about launching a company in these “Web 2.0” times. Here’s quick overview “by the numbers.”

• 0. I wrote 0 business plans for it. The plan is simple: Get a site launched in a few months, see if people like it, and sell ads and sponsorships (or not).
• 0. I pitched 0 venture capitalists to fund it. Life is simple when you can launch a company with a credit-card level debt.

Now, Guy will tell you that this is not the next Microsoft or Google, it’s a service that may grow on its own and maybe someday some bigger organization will want to add it to a portfolio because of the user base or whatever, and so it may have a nice exit someday.

But the best part, I think, for Guy is that when people send him business plans about how they really need to have $1 million Angel Round so that the team can develop a prototype, he can look them right in the eye and say, “Why? I launched a site for $12,107.09, and within two weeks it had 315,000 hits in Google. Why do you need 82.596 TIMES the money I spent to do what you want to do?”

They better have a darn good answer to that question.